Sovereign Gold Bonds
SGBs are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity. The Bond is issued by Reserve Bank on behalf of Government of India.
Key features:
- Eligibility: Restricted to resident Indian entities, including individuals, HUFs, trusts, universities, charitable institutions
- Investment: In a financial year –
Minimum: 1 gm. of gold Maximum: 4kg of gold for individual and HUF, 20kg for trust.
- Tenure: An Eight year tenure, with an option to exit after fifth year onwards
- Rate of Return: 2.5 % per annum ( paid semi annually)
- Liquidity: Lock-in period of 5 years. Gold bonds can be transferred however.
- Risk: No capital protection & Bond prices linked to Gold prices.
- Taxation : Interest on the Bonds will be taxable as per the provisions of the Income-tax Act, 1961 (43 of 1961). The capital gains tax arising on redemption of SGB to an individual has been exempted. The indexation benefits will be provided to long terms capital gains arising to any person on transfer of bond.
Sovereign Gold Bond Scheme 2020-21
The Sovereign Gold Bonds will be issued every month from April 2020 to September 2020 as per the calendar specified below:
|
S.No. |
Tranche |
Date of Subscription |
Date of Issuance |
|
1 |
2020-21 Series IV |
July 06-10, 2020 |
July 14, 2020 |
|
2 |
2020-21 Series V |
August 03-07, 2020 |
August 11, 2020 |
|
3 |
2020-21 Series VI |
Aug 31-Sept 04, 2020 |
Sep 08, 2020 |
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